Correlation Between Barksdale Resources and Jardine Matheson
Can any of the company-specific risk be diversified away by investing in both Barksdale Resources and Jardine Matheson at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Barksdale Resources and Jardine Matheson into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barksdale Resources Corp and Jardine Matheson Holdings, you can compare the effects of market volatilities on Barksdale Resources and Jardine Matheson and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Barksdale Resources with a short position of Jardine Matheson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barksdale Resources and Jardine Matheson.
Diversification Opportunities for Barksdale Resources and Jardine Matheson
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Barksdale and Jardine is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Barksdale Resources Corp and Jardine Matheson Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jardine Matheson Holdings and Barksdale Resources is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Barksdale Resources Corp are associated (or correlated) with Jardine Matheson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jardine Matheson Holdings has no effect on the direction of Barksdale Resources i.e., Barksdale Resources and Jardine Matheson go up and down completely randomly.
Pair Corralation between Barksdale Resources and Jardine Matheson
Assuming the 90 days horizon Barksdale Resources Corp is expected to under-perform the Jardine Matheson. In addition to that, Barksdale Resources is 2.89 times more volatile than Jardine Matheson Holdings. It trades about -0.35 of its total potential returns per unit of risk. Jardine Matheson Holdings is currently generating about -0.23 per unit of volatility. If you would invest 4,175 in Jardine Matheson Holdings on December 29, 2023 and sell it today you would lose (527.00) from holding Jardine Matheson Holdings or give up 12.62% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 95.65% |
Values | Daily Returns |
Barksdale Resources Corp vs. Jardine Matheson Holdings
Performance |
Timeline |
Barksdale Resources Corp |
Jardine Matheson Holdings |
Barksdale Resources and Jardine Matheson Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Barksdale Resources and Jardine Matheson
The main advantage of trading using opposite Barksdale Resources and Jardine Matheson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barksdale Resources position performs unexpectedly, Jardine Matheson can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Jardine Matheson will offset losses from the drop in Jardine Matheson's long position.Barksdale Resources vs. BHP Group Limited | Barksdale Resources vs. Rio Tinto ADR | Barksdale Resources vs. Kroger Company | Barksdale Resources vs. SCOR PK |
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Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Equity Valuation module to check real value of public entities based on technical and fundamental data.
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